Monthly Archives: October 2002

Edison is a publicly traded school-management company that has contracts to run 150 public schools in 23 states. According to the Toronto Globe and Mail, “Days before classes were to begin in September, trucks arrived to take away most of the textbooks, computers, lab supplies and musical instruments the company had provided — Edison had to sell them off for cash. Many students were left with decades-old books and no equipment. A few weeks later, some of the company’s executives moved into offices inside the schools so Edison could avoid paying the $8,750 monthly rent on its Philadelphia headquarters. They stayed only a few days, until the school board ordered them out. As a final humiliation, Chris Whittle, the company’s charismatic chief executive and founder, recently told a meeting of school principals that he’d thought up an ingenious solution to the company’s financial woes: Take advantage of the free supply of child labor, and force each student to work an hour a day, presumably without pay, in the school offices.”

Aha. If it’s Chris Whittle, then it must be true. His ventures, ranging from advertising-led publications in doctors’ waiting rooms to the Channel One “news” service for high schools, have always run more on hype and so-called high concept than real achievement.

English for Europe

Tim Garton Ash has a modest proposal in today’s Guardian: “If Britain really wants to catalyse the formation of a democratic Europe with a common language, we have to leave the EU… Let us, like Roman heroes of old, fall on our sword for the greater good.” Then, his argument goes, there will be no barrier to the rest of Europe agreeing that English should be the lingua franca of the Union.

I make no pretence of being a China hand, but I’ve long been convinced that approaching some understanding of the world’s most populous nation is crucial to understanding today’s world. The Financial Times is running an excellent series on China’s future that digs into the truths behind the easy hype.

Today, James Kynge explains that China’s economy is more fragile than is generally realised. “If China is to avoid slipping into its own version of Japan’s malaise, it must lose no time in pushing through structural reform, several analysts say. The most pressing task is to address a gross misallocation of capital that results in two thirds of the country’s credit resources being channeled toward state-owned companies that contribute only around one third of GDP. China’s policy makers understand the urgency of this imperative but are constrained by their fear of social chaos from acting resolutely upon it. No Chinese leader can afford to ignore the latent tensions among 1.3bn people; the famines, political upheavals and civil wars of the 20th century have delved deep into the national psyche.”

The British Politics weblog has an interesting — and to my mind highly accurate — reflection on reading the op-ed pages of The New York Times.

“One way reading the NYT is useful is that it reveal the gulf between British politics and American. To tell the truth, to me Paul Krugman isn’t even left wing. He’s just a skilled expositer of an ultra moderate form of social democracy. I wouldn’t even say he was to the left of Galbraith. He’s certainly to the right of Will Hutton, say.”

Coase theorem

If I were an even lazier blogger than I sometimes am, I could just point to Brad DeLong on a daily basis. But his brief illumination of the Coase theorem (“whenever a market fails to reach an efficient outcome, it is because of some failure of the bargaining process”) is worth a special pointer.

“The big place where the economy is threatening to fail to attain its efficient frontier today is in the intellectual property wars: consumers want a lot of high-quality entertainment and information cheap, but one set of producers makes money by selling bandwidth and another set of producers makes money by selling content. Bandwidth-sellers want consumers to be able to make whatever use they want of what they download. Content-owning firms want to charge consumers through the nose for what they own now and what they will produce in the future.

“AOL-Time-Warner, Sony, and a few others are on both sides of these intellectual property wars. So — because they are all part of one organization pulling together for the common good — it should be easy for AOLTW to resolve these problems within itself and get to an efficient Coasian bargain, right?

“<sarcasm>Right…</sarcasm>”

Completely beside the point, Coase spoke at one of the best-ever World Economic Forum sessions. At the Industry Summit (a long-since abandoned event) in Chicago in 1996, Coase was on a panel with fellow University of Chicago Nobelists Merton Miller, Gary Becker, Robert Fogel and Robert Lucas. (The UofC won economics Nobels in 1990, 1991, 1992, 1993 and 1995 — a pretty good run.)They were all on top form, but Coase, an 86-year old then, was the star. Despite decades in the US, he still had the wit and manner of the old-style English don. He laced his explanation of some of his work with self-deprecating asides that nicely undercut some of the towering egos on display elsewhere.

I can’t imagine many people were transfixed by the news last week that The New York Times bought out The Washington Post’s interest in the International Herald Tribune. But Peter Preston, a long-time editor of The Guardian and a perceptive observer of newspapers in general, reckons it seplls the death knell for the IHT.

Should anyone care? I’ve generally been in a minority in the circles in which I run in thinking the IHT is a poor excuse for a newspaper. In Switzerland, home of the World Economic Forum, a lot of bright people take it seriously and read it each morning in preference to the other English-language choices, the Financial Times and Wall Street Journal Europe.

Before the easy availability of The New York Times (and The Washington Post) on the Web, this made some sort of sense. It was useful to keep up with Tom Friedman, and where else could you find the baseball scores? The punishingly early deadlines of the IHT meant Friedman, for example, was always a day after his NY appearance, and the box scores also usually lagged a day. Now, what’s the point?

Although Preston describes the circulation of 260,000 as vibrant, split across scores of countries it means that the IHT has little impact (from an advertiser’s perspective) in any particular market. The poor results demonstrate the problem: annual losses of $5 million on revenues 20 times that. I’ll be curious to see what happens to the paper under the sole ownership of the Times. I think they’ve missed the boat if they hope to build an international edition. But I’d be glad to be proved wrong.

It’s school midterm break here, so we’re heading to Cornwall for a few days. No more posting this week on Davos Newbies.

Don’t read this in the US

Someone at the University of Pennsylvania has posted a cheeky page of online books that are out of copyright in some places, like Australia, but in copyright in the US. As Aaron Swartz points out, it would make perfect reading should there be an Eldred victory party.

The Washington Post nails a series of statements where president Bush has been economical with the truth. As it points out, there’s a long tradition of presidential embroidery, but Stephen Hess from Brookings notes, “What worries me about some of these is they appear to be with foresight. This is about public policy in its grandest sense, about potential wars and who is our enemy, and a president has a special obligation to getting it right.”

The argument has wider resonance, of course, because of the centrality of Troy in the literary imagination. But sadly, as Korfmann tells The New York Times, “We cannot excavate the Trojan War because it’s literature. We will never find Helen and Hector.”

“Google satisfies the current perception of truth by finding authorities, but by doing so it may cause that perception to change. It’ll spoil us commoners the same way scholars have been spoiled since ancient Greece, because while we won’t totally abandon our respect for authorities, we will at least lose our reservations against questioning them.”

Agriculture again

I wouldn’t have expected to be nodding in vigorous agreement with a Belgian prime minister on just about any issue you’d care to name. But Guy Verhofstadt says the right thing about Europe’s heinous agricultural subsidies: “Isn’t it hypocritical that precisely those agricultural products which are critically important to many developing countries — such as bananas, rice and sugar — are to a large extent excluded from free access to our market until 2006 and 2009?”

Oxfam’s Kevin Watkins has a strong polemic along the same lines in today’s Guardian. But, in a rare omission for The Guardian’s usually thorough site, I can’t find the article I read in the physical paper anywhere. Watkins, however, has made this argument before, notably when taking on the ostriches who still insist that poor countries should ignore export markets.

“In mathematical terms, the problem of finding the cheapest airfare between two locations is actually unsolvable. Even if you specify the route or the flights, the problem of finding the lowest fare could take the fastest computers billions of years to solve.” Keith Devlin explains that understanding airfares is even harder than you thought.

“If two people take a round trip together, with three flights in each direction, there can be as many as 10 to the power of 36 fare combinations. If you printed out a ticket for each possible fare, the pile would stretch to the nearest star, Proxima Centauri, four light years away.”

Economics lesson

D-Squared Digest provides a concise history of expectations in economics to put Daniel Kahneman’s Nobel prize in perspective. Even though I was advised to stop reading after the second paragraph, it’s a great introduction to a range of economic ideas.

I liked The Guardian’s take on the “election” in Iraq: “Certain occupations seem designed to attract the idle: editor of Kierkegaard’s complete football writings, for instance; leader of Hunstanton mountain rescue team; or ticket clerk at Cleobury Mortimer station. The thoughts of such people must have turned yesterday to a post which is, if anything, still more redundant than theirs: psephologist in Iraq.”

Alexandrian tales

Who wouldn’t be inspired by the idea of a new Alexandrian library to replace the lost wonder of the ancient world? But it sounds as if priorities have been twisted.

The original, built by the Ptolemies, was the greatest repository of information of its day with 700,000 papyrus scrolls. More attention today has been given to the building than its contents: the library will open with about 200,000 books, many of them little more than space fillers. (The Egyptians are hardly the only ones to make this mistake. In my hometown of Chicago, a wonderful building was completed for the city library, but they’ve never had much of a book collection.)

There’s worse. Director Ismail Serageldin dismisses criticisms about the lack of books: “The number of books we have is really not very important. We have the only backup copy of the internet archive between 1996 and 2001, which has 10 billion pages. We live in a digital age. Virtual knowledge will be our strength.” And worse. Chief librarian Layla Abdel Hady says books deemed potentially dangerous will be kept under lock and key. “What’s the point of antago nising people unnecessarily?”

Change in The Netherlands

When Jan Peter Balkenende became prime minister of The Netherlands, the world paid attention because of the assassination of Pim Fortuyn. Few outside the country will notice the government’s collapse.

A friend from The Netherlands writes: “Our government just collapsed after 86 days. The Lijst Pim Fortuyn (LPF) have been splintering since they entered office, and Balkenende (the HarryPotter-ish and feeble Christian Democrat PM) was unable to hold things together. The LPF’s two most senior ministers (economic affairs, and social affairs) quarrelled so badly they now only speak through intermediaries. And the ranking LPF MP told live national tv, ‘Don’t persecute me, I’m a manic depressive’ — before leaving to start a new party which contains her and one other MP. Meanwhile the former Miss Holland is talked of as a possible new LPF fractievoorzitter (party leader).”

Princeton computer scientist Ed Felten makes a vital point about the role of the general purpose computer. Legislators take note: “If you’re designing a computer, you have two choices. Either you make a general-purpose computer that can do everything that every other computer can do; or you make a special-purpose device that can do only an infinitesimally small fraction of all the interesting computations one might want to do. There’s no in-between.”

Forget MacArthur

I haven’t seen anyone questioning the analogy between a Tommy Franks-administered Iraq and a MacArthur-administered Japan. But Ian Buruma makes it clear how false any comparison would be.

“Despite all this terrible damage [suffered in the war], the software, so to speak, of Japan was intact. It was, in every respect, a modern nation-state, with a functioning bureaucracy that continued to administer the country under allied occupation. ”

Lomborg twofer

In a nice instance of synchronicity, I sold my now-unwanted copy of Bjorn Lomborg’s Skeptical Environmentalist through Amazon on the same day that The Royal Society made clear how wrong Lomborg (and others) are on biodiversity.

“We don’t know, possibly to a factor of ten, how many species there are on Earth,” says professor John Lawton of the Natural Environment Research Council. “But if the better-known ones are reasonably typical, we’re looking at an extinction rate a thousand times faster than in the fossil record — and it’s accelerating.”

Pointedly, Lawton also says, “We are consuming about half of all the available resources on Earth, and the rate is growing exponentially — it’s doubling every 30 to 50 years. It beggars belief that politicians don’t realise this, though it’s easy enough for them to identify al-Qaeda as a threat.”